Coronavirus hammers China's February economic activity: Data
29 February, 2020
China's manufacturing activity fell to its lowest level on record in February as official data on Saturday (Feb 29) confirmed the massive damage the deadly coronavirus epidemic has caused to the world's second-largest economy.
The announcement comes as the epidemic has rapidly spread to an increasing number of countries, pushing stock markets with their lowest levels because the 2008 global financial meltdown over fears that the coronavirus could wreak havoc on the world economy.
Analysts have warned that China's economic growth will likely have a major hit in the first quarter, and Saturday's data was the first glimpse at the damage the virus has caused to industries across the country.
The Purchasing Managers' Index (PMI), a key gauge of activity in China's factories, was at 35.7 points in February, well below the 50-point mark that separates growth and contraction on a monthly basis.
This was down from 50 points in January and the worst level since China began recording the figure in 2005.
It had been also well below expectations of a smaller contraction, at 45.0, according to a Bloomberg poll of analysts.
It was the first official economic indicator published for the month of February, showing the devastating impact of the epidemic on China's economy - with fallout apt to be seen all over the world.
IMPACT 'WEAKENING'
The National Bureau of Statistics said the auto and specialised equipment industries were hit hard, however the effect was "more serious" in the non-manufacturing area.
"There was a plunge popular for consumer industries involving gatherings of individuals, such as for example transportation, accommodation, catering, tourism, and resident services," the NBS said in a statement.
Non-manufacturing activity was at an abysmal 29.6 points in February, down from 54.1 points in January.
Authorities took drastic steps to contain the virus, curbing the movement of people, temporarily closing factories in the united states and quarantining central Hubei province, an integral industrial region where the epidemic first appeared.
The government has encouraged companies to progressively go back to work as the quantity of new cases has been dropping in the past 10 days.
"Although the brand new coronavirus pneumonia epidemic has caused a more substantial effect on production and businesses of Chinese enterprises ... the epidemic has come under initial containment, and the negative impact on production is slowly but surely weakening," the NBS said.
Source: www.channelnewsasia.com